Private equity in ophthalmology: taking the long view

Private equity's momentum in eye care remains controversial, even as investment continues to hasten the consolidation of ophthalmology and optometry practices. In this review, we discuss the growing implications of private equity activity in ophthalmology, drawing on updated empirical findings from the literature. We also examine recent legal and policy efforts to address private equity investment in healthcare, with implications for ophthalmologists considering sales to private equity. Concerns about private equity centres around evidence that some investment entities are not just valuable sources of capital or business expertise, but that they take outright ownership and control of acquired practices in order to drive high returns on investment. Although practices may receive considerable benefits from private equity investment, empirical evidence suggests that private equity's most consistent effect on acquired practices is to increase spending and utilization without commensurate benefits on patient health. Although data on workforce effects are limited, an early study on workforce composition changes in private equity-acquired practices demonstrates that physicians were more likely to enter and exit a given practice than their counterparts in nonacquired practices, suggesting some degree of workforce flux. State and federal oversight of private equity's impact on healthcare may be ramping up in response to these demonstrated changes. Private equity will continue to broaden their footprint in eye care, necessitating ophthalmologists to take the long view of private equity's net effects. For practices considering a private equity sale, recent policy developments highlight the importance of identifying and vetting a well aligned investment partner, with safeguards to preserve clinical decision-making and physician autonomy.